Just a day after increasing interest rates on both term and bulk deposits, the largest state-run lender has upped the lending rate represented by MCLR rate to 8.15% as against the previous 7.95% across different maturities.
The rates will come into force with immediate effect. According to the Thomson Reuters report, SBI that accounts for over one-fifth of the total banking assets has brought about the hike for the first time since the launch of the new lending system in April 2016.
Liquidity tightening, rise in bond yield, credit demand pick up and other profitability issues are pushing the banks to up the interest rates.
The shares of SBI was last trading lower by over 1% at Rs. 265.55 on the BSE.